The UK mobile advertising market was worth £181.5m in the first half of 2012, just £22m shy of the total UK mobile ad spend for the whole of 2011 (£203.2m), according to the latest Internet Advertising Bureau UK (IAB) advertising expenditure report, conducted by PwC.
According to the figures, mobile now accounts for 7 per cent of digital ad spend, after posting a 132 per cent year-on-year increase. Total digital ad spend is up by 12.6 per cent to £2.6bn. Video advertising also posted a healthy increase, rising 43 per cent to £69.8m, while revenues from banners on social media site increased by 36 per cent to £134.2m.
The report notes that the growth in mobile ad spend has been fuelled by smartphone ownership hitting 58 per cent of the UK population in June 2012 (source: comScore). Display, video, SMS and MMS advertising on mobiles increased like-for-like by 91 per cent to £49.9m, while mobile search posted a 152 per cent like-for-like increase to £131.6m, accounting for 72 per cent of mobile ad spend. Among media owners who submitted revenue figures to the IAB and PwC, ad spend on tablets is estimated to be worth “at least £2.4m” in the first half of 2012.
Display advertising across the internet and mobile, boosted by the increase in video and banners in social media, grew by 10.6 per cent year-on-year on a like-for-like basis to £590.9m from £534.7m, representing a 23 per cent share of digital ad spend in the first half of 2012.
Digital video advertising increased 43 per cent to £69.8m from £49m, accounting for 12 per cent of online and mobile display in the first six months of 2012; the equivalent share was 9 per cent in the same period in 2011. Banners in social media environments increased 36 per cent to £134.2m, accounting for 23 per cent of display ad spend, up from 19 per cent. Paid-search increased 15.9 per on a like-for-like basis to £1,5bn from £1.3bn, accounting for 59 per cent of digital advertising. 
Reflecting on the results, Tim Elkington, director of research & strategy at the IAB, said: “Almost 60 per cent of people in the UK have a smartphone, average UK household broadband speed is now 9MB, and social media accounts for one fifth of all internet time. As digital technology and services evolve to make consumers’ lives easier, more connected and more fun, it’s no surprise that advertisers are coming to the digital party with bigger budgets, despite the challenging economic times elsewhere.
“However, there’s still plenty of room for growth. Take mobile: 60 per cent of the UK’s 100 biggest advertisers still don’t have a mobile-optimised website, yet consumers spend almost 70 per cent longer on sites which are. If all advertisers get wise to this, we’re likely to see significant mobile growth for some time yet.”
The biggest spenders on digital display in the first half of 2012 were FMCG (Fast Moving Consumer Goods, aka Consumer Packaged Goods or CPG in the US) on 16 per cent each, followed by Entertainment & media (13 per cent), Retail (11 per cent), and Travel & Transport (10 per cent).
